OpenAI's $40 billion funding round could shrink to $30 billion unless the company restructures as a for-profit entity by December 31, CNBC reported on Monday. According to the report, SoftBank, the largest backer, would cut its investment from $30 billion to $20 billion if the change does not occur.
The financing deal, which would value OpenAI at $300 billion, also includes a $10 billion contribution from Microsoft and others. Investors would receive convertible notes that would turn into equity upon the restructuring.
The pressure adds urgency to OpenAI's transition, which still requires approvals from Microsoft and the California Attorney General and faces legal resistance from co-founder Elon Musk. The funds are partly tied to Stargate, a joint venture with Oracle and SoftBank announced earlier this year.
